Australian cryptocurrency exchange TrigonX is the latest recovery story following the collapse of FTX, which is set to restart after a December crash with more than $50 million in debt.
According to company director Matteo Salerno, TrigonX will be revived after creditors approve a corporate deed of arrangement, The Australian reported on May 29.
Founded in 2014, the digital asset exchange was one of many exchanges affected by FTX's sudden crash in November. TrigonX appointed administrators on December 16 after being unable to meet withdrawal requests. Salerno said restoring "better, more certain and more convenient dividends" to creditors would be better than liquidation. "A liquidation could tie up funds that the administrator has controlled for years. This would result in a substantial drying up of funds available for distribution to the benefit of creditors."
He added that the aim behind the receiver was to "achieve a quick and optimal outcome for creditors". A report by law firm Kroll confirmed that Trigon's failure was caused by a combination of factors, including the collapse of FTX. The situation is also complicated by legal action taken against the company by customers seeking to return their funds.
Kroll also looked into several large transactions FTX made with Salerno himself and his wife before its collapse. Salerno said the payments asked about in the Kroll report were made "in the context of updating employee rights" given the company's imminent sale. Sydney-based investor King River Capital is one of the creditors. According to an April report in the Australian Financial Review, the firm is working to recover $9 million from TrigonX, which King River did not authorize to trade on FTX at the time.
In January, Australian cryptocurrency exchange Digital Surge was revealed to be another firm that narrowly avoided collapse following the FTX debacle, despite having millions of dollars tied up in digital assets. In January, Digital Surge creditors approved a five- year bailout while allowing the company to continue operating.
